Upon my modifications, and executing the script, I get the following errors.
$ perl.exe perl1.pl
Variable "$NAMES" is not imported at perl1.pl line 36.
Global symbol "$NAMES" requires explicit package name at perl1.pl line 36.
Missing comma after first argument to open function at perl1.pl line 43, near ""
Cannot open target file. $!\n";"
Execution of perl1.pl aborted due to compilation errors. UPDATE- Modifications.
#!/usr/bin/perl
#read each line in test1.txt into data_file array

use strict;
use warnings;

my $data_file = "test1.txt";
my $names_file = "code.txt";
my $target_file = "target.txt";
my @data = (); # Cannot be the same name as above
my @names_data = ();
my @target = ();
my $line = '';

open(DATA, $data_file)
      || die ("Could not open file! $!\n");
@data=<DATA>;
close DATA;

open(NAMES, $names_file)
      || die ("Could not open file! $!\n");
@names_data=<NAMES>;
close NAMES;

#read each line in code.txt into a names_file array
foreach $line (@data) {

#create loop that reads each ID in
#code.txt (NAMES array), searches for
#each in array elements for test1.txt
#(DATA array), redirects a new
#(NAMES).html for each element
foreach ( @names_data )
{
chomp;
push @target, qq|$line<0> > +("$NAMES.html")\n|;
#I do not understand what you are trying to do above...
#Just modify the part between the pipes |...\n| to include
#whatever variables you are wanting.
}
}
open TARGET ">$target_file"
     || die "Cannot open target file. $!\n";
print TARGET @target;
close TARGET;